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Berlin, Ocean Pines News Worcester County Bayside Gazette Logo Berlin, Ocean Pines News Worcester County Bayside Gazette

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Resort’s court loss a win for everyone else

The question mainland residents might be asking themselves this week following the Town of Ocean City’s loss of its tax differential court case against Worcester County is, “So what?”

Whether taxpayers know it or not, the Maryland Court of Appeals’ rejection of resort government’s attempt to overturn two lower court decisions that went against it is not only a big deal, it’s why Ocean City lost the case.

In its original lawsuit in Worcester County Circuit Court in 2018, Ocean City argued that the county real estate tax levied on resort property owners should be less than that charged residents in other jurisdictions because resort taxpayers were paying for county services they did not use.

Instead, they were using similar or identical services the city supplied, and Ocean City officials believed the county should create a separate tax rate for the resort to reflect that difference.

The problem with that, the court found, was that whatever tax cut Ocean City would have received by this tax setoff or tax differential, as it is also known, would have been passed on to all the county’s other taxpayers as a major tax increase.

The fact is Ocean City property tax revenue to the county allows the latter to operate more comfortably from a financial standpoint than it would be able to it if was more dependent on revenue generated by mainland properties.

This situation may not be fair to resort taxpayers, but it would be equally unfair to foist that financial burden suddenly on taxpayers in Berlin, Ocean Pines, West Ocean City and points south.

Further, the county commissioners representing the mainland districts would have been hard-pressed to explain to their constituents why their annual tax bills jumped by hundreds and even thousands of dollars from one year to the next.

That’s why this ruling by the state’s highest court is a significant victory for the county and its mainland communities, even if they were unaware of what was at stake.